1833. Ex parte ROBINSON But the question now under consideration is, not as to the dominion of the solvent partner over partnership property, but merely as to the right of a bond fide creditor to prove against the joint estate upon a joint bill In the matter of exchange given by the solvent partner for a partnership liability. If the payment of a debt by the solvent partner is valid, a fortiori, therefore, the solvent partner may, for the same purpose, draw or accept a bill; and so it is decided by Lacy v. Woolcott, 2 D. & R. 460; Ramsbottom v. Lewis, 1 Camp. 278 ; Craven v. Edmondson, 4 M. & P. 627; 6 Bingham, 737, where the case of Lacy v. Woolcott is recognized by the Court as law. It has been said, that by relation there was a severance of the partnership from the time of the act of bankruptcy, and that, after the severance, there was no joint property, and therefore no joint debt could be contracted. [LORD CHANCELLOR :-A third party, the assignees, having been introduced.] The fallacy of that argument is obvious, for, if so, there could be no joint estate to be administered under the commission. Had the bankruptcy not happened, the joint property, or the separate property of each partner, might have been taken in execution under a joint judgment, and the only difference in bankruptcy is, that the right of the creditor is limited upon a joint debt, by compelling him to resort to the joint estate, which the assignees must keep distinct, to satisfy the joint debts. The joint property continues the same in the hands of the assig nees as it was before the bankruptcy. That there is not any such severance will, however, appear from the cases already cited. of HOUGHTON and another. 1833. Ex parte In the matter of HOUGHTON It has been said, that there is a difference between transferring property and creating a liability. It is true that, previous to the passing of the 49 Geo. 3, c. 135., s. 2, a debt contracted after an act of bankruptcy was not proveable; but by that statute the party must have and another. notice of the act of bankruptcy at the time of giving credit, to affect his right; and the law is the same in cases of set-off. Hawkins v. Whitten, 10 B. & C. 217; Dickson v. Cass, 1 B. & Ado. 355. And again, by sect. 82, all payments bona fide made by or to any bankrupt are valid, notwithstanding a prior act of bankruptcy, "provided the person so dealing with the bankrupt had not at the time of such payment notice of such act of bankruptcy." Such is the spirit of the whole statute. (a) Upon the whole, therefore, it is submitted, that the judgment of the Court of Review is erroneous, and that the appellant is entitled to prove against the joint estate. Mr. Swanston and Mr. Montagu for the respondents: The argument for the appellant has not been addressed to the specific question before the Court; and the various cases cited are wholly inapplicable to the real question. It is not, whether the solvent partner has dominion over the partnership effects after the bankruptcy of his co-partner, nor is it as to any personal liability of the parties, nor is the question, whether the appellant is entitled to prove, but against what estate he is so entitled. (a) See sections 81, 84, 88. As to the cases which have been cited to shew that the partners would be personally liable, or that the solvent partner is authorized to deal with the partnership property, they are inapplicable to the present case, as the only question now under consideration is, whether, after the bankruptcy by one partner, his co-partner is competent to create a new liability by a bill of exchange upon which a proof can be made against the joint estate; and it has been contended that he is. But there is not any case to warrant such a proposition. It is true that most of the decisions. opposed to this proposition are the dicta of Judges at Nisi Prius; but they have been so little doubted, that it does not appear that any have been brought under the consideration of the Court in Banco. It may be admitted that, in the case of an existing partnership, the joint estate would be liable; but in the present case there was no existing partnership; and the assignees had, by relation, become tenants in common with the solvent partner, of the partnership property; and the question is, whether he can bind himself and the assignees. But a solvent partner cannot so bind the estate of himself and the assignees. Kilgour v. Finlayson, 1 H. B. 155; ex parte Ruffin, 6 Ves. 119; ex parte Wait, 1 J. & W. 605; Dutton v. Morrison, 17 Ves. 197, in which case Lord Eldon says, "It is not the property of A. and B., but the joint property of A. and the assignees of B. In Kilgour v. Finlayson, 1 H. B. 155, it was decided. that a joint liability cannot be created if there is no joint interest in property upon which liability can attach. In Abel v. Sutton, 3 Esp. 108, it was decided by Lord Kenyon, that, after the dissolution of a partnership, one of the persons who composed the firm cannot put the 1833. Ex parte ROBINSON. In the matter of HOUGHTON and another. 1833. Ex parte ROBINSON. of partnership name on any negotiable security, even though such existed prior to the dissolution, or was for the purpose of liquidating the partnership debts, notIn the matter withstanding such partner may have had an authority HOUGHTON given him to settle the partnership affairs; and in and another. Wright v. Pullen, 1 Star. 375, Lord Ellenborough, following Lord Kenyon, decided, that where, after the actual dissolution of a partnership, one member accepted a bill in the partnership name, bearing date before the dissolution, an indorsee, who takes the bill without notice of the dissolution, could not enforce the bill against the other member. That a dissolution by bankruptcy is, by relation, from the time of the act of bankruptcy, when followed by a commission and assignment, is established by a variety of cases. Fox v. Hanbury, Cowp. 450; Smith v. Oriel, 1 East, 308. Lacy v. Woolcott, 2 Dow. & R. 460, has, however, been chiefly relied upon; but that case does not warrant the proposition contended for by the appellant. It was decided upon a different ground. The bankrupt partner and the solvent partner had, after the act of bankruptcy, recognized their liability, by holding themselves out as partners; and in that case the question was not as between creditors. It is submitted, therefore, that it is not competent for a partner, after dissolution by bankruptcy, to create a liability upon which proof can be made against the joint estate. Sir Edward Sugden in reply: It is admitted, that if the bankruptcy had not happened the partners would have been liable; but it is said that a solvent partner cannot make the estate of himself and the assignees of the bankrupt liable for a As to ex parte Ruffin (b), and the cases of that class, they merely decide, that, if property is transferred by the old to the new firm, the creditors of the old firm have no right in preference to the new creditors. With regard to the equity of the case, it has been said that the question is to be considered the same as if it were with Davies. But not so; for whatever equities might have existed as against Davies, they cannot affect the right of Robinson, who took the bills in regular course of business, without notice either of the bankruptcy or of any equities which might have existed. the doctrine contended for by the assignees is right, there cannot be any dealing with any partnership without instituting enquiries whether one of the partners may not have committed an act of bankruptcy. If The appellant is, therefore, entitled to prove, and the decision of the Court of Review must be reversed. Curia advisare vult. 1833. Er parte ROBINSON. In the matter of HOUGHTON and another. |